This year’s Double Eleven saw the first success for beauty brands.
On the evening of October 21, the beauty industry opened 21 minutes cumulative pre-sale effective amount, more than 12 hours last year, the beauty industry opened 45 minutes pre-sale broke 10 billion, the first hour merchants broke 3 billion, single product broke 1.6 billion.
Of course foreign giants still occupy the first echelon, Jingdong’s data show that Estee Lauder, Helena, Clinique, Guerlain, Maike Fei and other 50 head high-end big brands overall rose more than 100%. In the competition with foreign brands, some emerging national brands also performed well, such as CHANDO has successfully entered the billion dollar club.
During the same period, CHANDO and Tmall also joined forces to create an NFT product called “Himalayan Ice Sundial”, becoming the first Chinese beauty brand to partner with Tmall to create an online virtual digital product. So what is NFT and why is CHANDO entering this market?” What new inspiration can the new model of “NFT + beauty” bring to the industry?
The NFT industry is hot as big manufacturers enter and the boundaries widen
A new “wealth creation myth” this year, NFT is already a familiar concept to many.
On the blockchain, digital cryptocurrencies can be broadly divided into two types: native coins and tokens. The former include Bitcoin and Ether, which have their own master chains and maintain ledger data through on-chain transactions; tokens are attached to existing blockchains and use smart contracts to keep track of the ledger, such as those attached to Ether.
Within this, tokens can be classified as homogeneous and non-homogeneous. Homogenized tokens, called FT – Fungible Token, are fungible and can be split nearly infinitely. The other type is what this article calls NFT – Non-Fungible Token, which is indivisible, irreplaceable and unique.
In 2012 ColoredCoin was born, consisting of small denominations of bitcoins, demonstrating the malleability of real assets on the chain and setting the stage for the development of NFT, and five years later CryptoPunks – the first real NFT project – was born.
In the years prior to that, NFT had garnered some attention, but not much buzz until March of this year, when American digital artist Beeple’s NFT work Everydays: The first 5000 days sold for a whopping $69.348 million (about RMB 449 million) at Christie’s UK auction, setting a digital art A new record for the transaction. A new record for digital art. The entire NFT market was immediately thrust into the limelight.
Capital with a keen sense of smell quickly and eagerly joined in once they found it lucrative.
Ali issued a batch of NFT Alipay code skins based on the Ant Gold chain, including Dunhuang, Assassin Five Six Seven cooperative models and a co-branded model of White Snake 2; Tencent’s PCG launched the Phantom Core App, which claims to be “China’s first NFT trading platform”; NetEase’s game Eternal Robbery Infinity IP authorized the release of NARAKAHERO, a series of NFT blind boxes.
In addition to Internet giants such as Ali, Tencent and Netease, NFT, as the place where the economic base of the meta-universe is built, has also attracted a large number of investors.
This is because NFT can become a concretization of the rights of the meta-universe, allowing humans to create a real parallel universe in the world of blockchain. Simply put, it is because the emergence of NFT enables the assetization of virtual goods and thus the flow of value of data content. It changes the traditional model of trading virtual goods by allowing users to freely trade the associated NFT assets among themselves.
On October 29, Facebook, the world’s sixth largest social media giant by market capitalization, officially announced its name change to “Meta”, which shows Facebook’s ambition and determination for this piece of the metaverse. Following the name change, Vishal Shah, head of Facebook’s meta-universe, said that the “Meta” universe will introduce NFT as part of its ecology, indicating the importance of NFT in the meta-universe world.
As the number of players increases, the boundaries of the NFT market are also widening. Art, audio, film, gaming, sports and even finance are just a few of the many areas where “everything can be NFT.” Now, thanks to the actions of Naturals, beauty brands, especially in China, are also becoming “champions” of NFT.
CHANDO Launches NFT Products Beauty Community Becomes NFT Fans
It is reported that the CHANDO Ice Skin Water + NFT Edition Ice Skin Water Collection is limited to 100 copies and features AYAYI, China’s first surreal digital person and the hottest avatar, as a Tmall Superbrand digital booster.
However, although this “NFT + beauty” model is quite creative, Naturally Tang is not the first company to take the crab.
Not long ago, Givenchy Beauty announced that it would be launching a series of NFT artworks, making it the first fashion and beauty brand to launch an NFT project.The NFT art series will be a collaboration between Givenchy, London gallery owner Amar Singh and the artists at Rewind Collective.
There are also niche beauty brands jumping on the bandwagon, such as Michelle Phan after relaunching EM Cosmetics using a platform with blockchain technology; online cosmetics retailer Cult beauty is using blockchain to combat greenwashing in the beauty industry; and Look Labs is combining fragrance and NFT.
There are three main reasons why many beauty brands have become enthusiastic advocates of NFT: for one, the blockchain technology behind NFT does have a boost for the beauty industry. Like the aforementioned EM, Cult beauty and Look Labs, blockchain has changed the way they handle money, data and logistics to some extent.
Secondly, from a value and image perspective, access to NFT is an important manifestation of innovation and catching up with new technology, not only to convey brand value and carry it, but also to project a high-end corporate image.
Naturally, the Himalayan sundial, an NFT product created in collaboration with Tmall, serves this purpose. For example, the digital form commemorates the nature on which human beings depend, and the virtual image unites the most primitive and purest worship of human beings, conveying the concept of enjoying nature and living well based on the Chinese philosophy of the unity of heaven and man. The liquid metal, representing the infinite flow of time in the metaverse, twists and circulates around the Himalayan ice-blue device. The flowing gesture of the liquid metal is intended to mimic the spirituality and purity of glacial water, which also creates a high-end brand image for Naturally Plus Ice Water.
Third, from a marketing perspective, NFT’s visibility continues to grow. According to Coin Gecko data, NFT’s overall market cap reached $12.7 billion in 2021H1, an increase of nearly 310 times compared to 2018. According to Non Fungible data, NFT trading volume exploded in 2021Q2 at $754 million, up 3,453 percent year-over-year and 39 percent sequentially.
The popularity of NFT will also help brands to market themselves better after the launch of NFT artwork by brands like Naturals and Givenchy. So the question is, will NFT energize the beauty market in the long run?
Can NFT energize the beauty market in the long run as the sunshine crosses with the fog?
While the “NFT + Beauty” model has its merits, there is still a cloud of gloom ahead. First, being tied to NFT is inherently risky.
That’s because NFT is an unregulated virtual asset, and there are currently no legal norms for NFT in place globally, meaning that once a relevant policy is in place, for better or worse, the industry is bound to create a violent upheaval.
In May this year, the China Internet Finance Association, the China Banking Association and the China Payment Clearing Association jointly issued the Notice on Preventing the Risk of Bitcoin and the Announcement on Preventing the Risk of Speculation in Virtual Currency Trading, which strictly prohibits speculation in virtual currencies. In fact, these notices and announcements were not strictly directed at NFT, but caused a general shakeup in the entire cryptocurrency market.
It is reported that the total market capitalization of cryptocurrencies has fallen from an all-time high of $2.5 trillion in May this year to the current $1.3 trillion, while the overall sales of the NFT circuit have plummeted 95% from a high of $176 million to $8.6 million.
Based on this factor, whether it’s blind boxes, beauty or luxury goods, it’s still important to gauge beforehand whether you can afford the risk it may pose in the future before thinking about forming a CP with NFT.
On top of the risks that policy may bring, the NFT mania has also given rise to a number of industry disruptions, including but not limited to Ponzi schemes, hacking, money laundering crimes, contraband trading, and even new technology scams that combine concepts such as art investment and equity crowdfunding to package works of little artistic value on the chain.
Most common, of course, is speculation and price gouging, and where there is a market, there are “scalpers”.
According to screenshots provided by netizens, there are scalpers posting on idle fish.” High price recovery paypal Dunhuang Academy of Fine Arts NFT number 0001 or 6666, 100,000 a, other numbers 500 a.” On a second-hand trading platform, the NFT art collection, originally priced at $18, has risen to 100,000-200,000 yuan at auctions, with the price of a special limited edition NFT rising to 260,000 yuan.
So against the backdrop of a less than perfect and healthy NFT ecology and a less than compliant industry, beauty companies need to take a more cautious approach to entry.
On the other hand, the beauty industry has been in turmoil in the first place, with plagiarism, counterfeit products, lack of quality, inadequate technological barriers, etc., being the main factors limiting progress in the beauty industry. So it is understandable that companies like Givenchy and Naturally Plus are pushing NFT hard internally in order to give their brands a more high-end image and also to promote product sales with gimmicks.
But the truth is, to put it bluntly, consumers are not stupid, and in an industry like beauty, where results are more important, product power is the word. This is the main reason why during this Double Eleven, “L’Oreal Complex Retinol Anti-Wrinkle Water Cream was sought after by consumers and grew more than 10 times year-on-year, SK-II Big Red Bottle Face Cream 100g (Classic Edition) grew 380% year-on-year, and the popular SK-II Divine Water grew nearly 3 times year-on-year”.
All in all, one has to admit that for beauty brands, entering NFT is more of an innovative act to export their brand culture in the digital economy. On the other hand, they also hope to let more consumers build up their brand awareness through the virtual marketplace, but the proposition of whether the new model of “NFT + beauty” is desirable and whether it can bring vitality to the industry in the long run may still need to be answered by the market. Time will give us the answer.